Proposal Name: Tokenomics - Fulfill Contractual Obligation with Balancer Regarding the BANK/wETH Pool on Ethereum Mainnet
Program Champion(s): Icedcool, nonsensetwice, general tokenomics crew
OP Date: April 2022
Status: Forum Voting [Draft->Voting->Forum Voting->Closed]
Per bDAO’s agreement with Balancer Protocol, Balancer requires 475K BANK to distribute rewards to those who provided liquidity during the rewards period for the original BANK/wETH pool on Ethereum Mainnet.
The BanklessDAO (bDAO) Tokenomics team works to find and create opportunities for BANK token owners to incentivize their holding of the token. One such method is to partner with specific decentralized finance (DeFi) protocols to allow BANK token owners to increase their holdings by providing liquidity mining incentives to any BANK token owner that provides liquidity (Liquidity Providing/Provider, or LP) to BANK pools in those protocols. This mechanism not only allows for a higher yield percentage on fees accrued in said pools, but also provides rewards in the form of more BANK tokens, as well as protocol tokens.
One such agreement was made in August of 2021 to launch an 80/20 BANK/wETH liquidity pool with Balancer protocol. The proposal passed and the BANK/wETH Balancer Pool on Ethereum Mainnet was established with liquidity mining benefits that allowed Liquidity Provider (LP) token owners to earn both BAL and BANK for participating. Due to miscommunication with the timing for rewards distribution, Balancer ran rewards for five weeks beyond what was agreed upon. As a result, they have come up short on BANK to distribute. Because bDAO values our partnership with Balancer, we want to address this discrepancy and provide Balancer with the necessary BANK to distribute as rewards to those who provided liquidity during the extended rewards period.
This proposal addresses this inconsistency and fulfills bDAO’s obligation to Balancer and LP token owners. Upon approval, bDAO will provide 475K BANK to Balancer to distribute five weeks worth of liquidity mining rewards to LP token holders during the reward period, not only honoring bDAO’s agreement with Balancer, but in appreciation for their willingness to provide rewards . This will also serve to maintain bDAO’s social capital, as potential partners can be confident that bDAO executes on its responsibilities.